IN THE SUPREME COURT OF THE STATE OF IDAHO
Docket No. 50279-2022
JOHN GOMEZ, an individual, )
)
Plaintiff-Counterdefendant- ) Boise, May 2024 Term
Appellant, )
) Opinion filed: August 6, 2024
v. )
) Melanie Gagnepain, Clerk
GILBERT HURTADO, an individual; and )
JESUS HURTADO, an individual, )
)
Defendants-Counterclaimants- )
Respondents, )
)
and )
)
G & H DAIRY, LLC, an Idaho limited liability )
company, )
)
Defendant-Counterclaimant. )
)
Appeal from the District Court of the Fifth Judicial District of the State of Idaho,
Jerome County. Ned C. Williamson, District Judge.
The decision of the district court is affirmed.
Robinson & Cotten, Rupert, for Appellant. Brent T. Robinson argued.
Sawtooth Law Offices, PLLC, Boise, for Respondents Gilbert Hurtado and Jesus
Hurtado. Brian A. Faria argued.
ZAHN, Justice.
This case concerns a dispute between the three members of a limited liability company.
John Gomez, Gilbert Hurtado, and Jesus Hurtado were the members of G & H Dairy, LLC
(“G&H”). In 2013, G&H defaulted on its Wells Fargo Bank loans and the members of G&H
engaged in a series of negotiations with Wells Fargo to avoid bankruptcy. During these
negotiations, the members signed a “letter of intent” (“LOI”) that indicated G&H would distribute
the real and personal property of G&H to Gomez and Jesus Hurtado and requested that Wells
Fargo agree to certain terms. G&H successfully restructured its debt with Wells Fargo, which
involved Gomez and Jesus Hurtado separately purchasing the personal property business assets of
the dairies and assuming portions of G&H’s debt. However, Gomez and the Hurtado brothers
could not agree on a sales price for the real property associated with the dairies.
Gomez commenced this lawsuit against the Hurtado brothers and G&H (collectively “the
Hurtados”) asserting claims for breach of contract, estoppel, unjust enrichment, and breach of
fiduciary duty related to the failure to convey the real property to Gomez. Gomez also sought
judicial dissolution and winding up of G&H. The Hurtados filed counterclaims against Gomez
seeking damages under several equitable theories and also seeking dissolution and winding up of
G&H. The district court granted summary judgment in favor of the Hurtados on Gomez’s breach
of contract claim after concluding that the LOI was unenforceable but denied summary judgment
on the remaining claims. Following a bench trial, the district court ordered the dissolution and
winding up of G&H and dismissed the parties’ remaining claims. Gomez appeals.
We affirm because the LOI is unenforceable, and the district court did not err in dismissing
Gomez’s remaining claims or in its winding up and accounting of G&H.
I. FACTUAL AND PROCEDURAL BACKGROUND
G&H is a three-member limited liability company, organized in 2004 for the purpose of
engaging in the dairy business. G&H’s members were John Gomez, and brothers Gilbert Hurtado,
and Jesus Hurtado. Each owned a one-third interest in G&H. Gomez was responsible for the
financial affairs of G&H and Gilbert managed the dairy operations. G&H owned three dairies: the
Wendell Dairy, the Buhl Dairy, and the Preston Dairy. The members of G&H partnered with
others, who are not parties to this case, to create an entity separate from G&H to purchase a fourth
dairy, Legacy Dairy. That entity is not a party to this appeal. G&H financed the purchase of its
three dairies by taking out loans from third-party lenders, including Wells Fargo Bank. G&H also
obtained an operating line of credit from Wells Fargo.
As a result of the financial downturn in the late 2000s, G&H experienced financial
difficulties. In 2009, milk prices dropped, feed costs increased, and the loan-to-value ratio on
G&H’s loans began to deteriorate. In response to the deteriorating loan-to-value ratio, Wells Fargo
internally designated G&H’s loans as one of its “special assets,” which resulted in greater scrutiny
of the loans by Wells Fargo and a reduction in the length of the loans. In 2011, there were disputes
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between the members of G&H relating to Gomez’s management of the financial affairs of G&H.
As a result, the Hurtado brothers took possession of the financial records of G&H. By 2012, G&H
was aware that its financial situation with Wells Fargo was deteriorating because it was borrowing
more than the collateral securing the loans could support.
The members of G&H began negotiating with Wells Fargo to restructure G&H’s loans.
The members of G&H first proposed that Jesus and Gomez would purchase the dairy properties
themselves. Wells Fargo did not agree to the proposal. Instead, on April 29, 2013, G&H received
a Notice of Default from Wells Fargo, which declared G&H in default on almost $24 million in
loans. The members of G&H began a new series of negotiations with Wells Fargo to avoid having
G&H file for bankruptcy.
On May 6, 2013, the Hurtado brothers and Gomez sent a letter to Wells Fargo proposing
that Gomez and Jesus buy the personal property assets of the three dairies but lease the real
property from G&H. It is unclear whether Wells Fargo ever responded to the letter. On May 15,
2013, Gomez and the Hurtado brothers sent Wells Fargo a new document proposing different terms
entitled, “Outline of Proposed Transactions,” which provided that Gomez would “acquire” the
dairy facilities, herd, feed, and equipment of two dairies, while Jesus would “acquire” the dairy
facilities, herd, feed, and equipment of the remaining dairy. On May 16, Wells Fargo sent a
response letter rejecting the May 15 proposal.
On May 21, 2013, the Hurtado brothers and Gomez signed a “Letter of Intent” (“LOI”)
that contained a new, third set of terms that differed from those in the May 6 and the May 15
letters. The LOI “distributed” the Wendell Dairy and its assets to Jesus, and “distributed” the Buhl
Dairy and Preston Dairy and their assets to Gomez. The LOI provided that Gomez and Jesus would
assume the debts of G&H. Under the LOI, Gilbert neither received any assets of G&H nor took on
any of its debt.
Wells Fargo did not formally respond to the LOI, but instead sent term sheets for the
restructuring of G&H’s debt that distributed the debt between Jesus and Gomez and provided for
new operating loans that would allow them to operate the respective dairies. Between May 21,
2013, and September 2013, negotiations continued and revised term sheets were exchanged.
On June 11, 2013, G&H sold the personal property assets of the Wendell Dairy to an
unrelated third party, Harry’s Dairy, and used the sale proceeds to pay down G&H’s operating
debt. Harry’s Dairy leased the Wendell Dairy real property from G&H.
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During this time, Gomez formed two new LLCs: Melon Valley, LLC and Daytona, LLC.
Gomez was the sole member of each LLC. In September 2013, term sheets with Wells Fargo were
finalized with, and executed by, Melon Valley and Daytona. The term sheets identified that Melon
Valley and Daytona would lease the real property of the Buhl and Preston dairies and receive new
lines of credit to purchase the personal property assets of the Buhl and Preston dairies. The
proceeds from these asset sales would be used to pay down the operating debt that G&H owed to
Wells Fargo.
Jesus also owned two LLCs: Jesus Hurtado Dairy LLC (“JHD”) and Triple H Dairy LLC
(“Triple H”). In September 2013, term sheets with Wells Fargo were finalized with, and executed
by, JHD and Triple H. The term sheets identified that Triple H would receive a new line of credit
to purchase the personal property assets of Legacy Dairy.
On December 18, 2013, the respective LLCs closed on the loan transactions with Wells
Fargo as contemplated by the term sheets. As part of the transactions, Melon Valley and Daytona
entered into purchase and sale agreements with G&H for the personal property assets of the Buhl
and Preston dairies and entered into lease agreements for the real property associated with both
dairies. Triple H entered into a purchase and sale agreement for the personal property assets of
Legacy Dairy and a lease agreement for the real property. The effect of the agreements was to
restructure G&H’s operating debt.
Following the sale of all of its personal property assets, G&H became a landholding and
real property leasing entity. Melon Valley operated the Buhl Dairy until 2015, at which time it
ceased operations and subleased the Buhl Dairy real property to several unrelated third parties
through 2021. Daytona operated the Preston Dairy until 2017, when Daytona lost its milk contract,
ceased all operations at the Preston Dairy, and stopped paying rent to G&H. In 2016, JHD took
possession of the Wendell Dairy real property and began making lease payments to G&H.
Between 2013 and 2021, JHD had access to 330 acres of the Wendell Dairy for which it did not
pay rent.
Following the restructuring of G&H’s debt with Wells Fargo, the members of G&H
agreed that the real property associated with the three dairies needed to be sold, but the members
could not agree on the material terms for the sales. On October 26, 2016, Gomez filed a complaint
against the Hurtados for: (1) judicial dissolution of G&H; (2) breach of contract; (3) estoppel; (4)
unjust enrichment; and (5) breach of fiduciary duty. Gomez alleged that the LOI was an
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enforceable contract and that the Hurtados breached the contract when they refused to convey the
real property to him, as contemplated by the terms of the LOI. The Hurtados filed a counterclaim
against Gomez for judicial dissolution and various other claims. The case languished in court for
several years.
On April 16, 2019, the parties stipulated that the real property associated with the three
dairies would be appraised, the parties could exercise options to purchase the properties, and if the
options were not exercised, the properties could be sold to a third party. The stipulation required
any net proceeds from the sale to go into a joint bank account controlled by all three members of
G&H. On March 4, 2021, Hurtado Farms, LLC, an entity created by Jesus, purchased the real
property associated with the Wendell and Buhl dairies. The net proceeds of the sales were placed
in a joint escrow account.
On or before 2020, the Preston Dairy suffered approximately $600,000 in vandalism and
theft and the parties agreed the repairs should be completed before the property was sold. The
parties stipulated to the sale of the Preston Dairy real property but have not marketed the property
because the repairs have not yet been completed.
On May 10, 2021, the Hurtados moved for summary judgment on Gomez’s breach of
contract claim, arguing that the LOI was an unenforceable agreement to agree and lacked sufficient
property descriptions to transfer the real property associated with the Buhl and Preston dairies. The
district court agreed and granted summary judgment in favor of the Hurtados.
The Hurtados then filed a second motion for partial summary judgment on Gomez’s claims
of quasi-estoppel, unjust enrichment, and breach of fiduciary duty. The Hurtados argued that
Gomez’s quasi-estoppel claim should be dismissed because the LOI was not an enforceable
agreement; the unjust enrichment claim should be dismissed because Gomez agreed to the
restructuring and therefore the Hurtados were not unjustly enriched; and the breach of fiduciary
duty claim should be dismissed because Gomez agreed to restructure the debt and enter into the
new loans with Wells Fargo. The district court denied the motion after determining that there were
genuine issues of material fact concerning whether the Hurtados changed their position on
transferring the real properties to Gomez and the distribution of G&H’s assets and liabilities, and
whether the Hurtados breached a fiduciary duty when they refused to transfer the real properties
to Gomez.
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The parties stipulated to the appointment of a Special Master, Certified Public Accountant
Dennis Reinstein, to provide the district court with an accounting of the financial records of G&H
as it related to disputed factual issues. The parties then identified twelve disputed factual issues for
Reinstein to resolve. The issues generally related to accounting transactions of the members of
G&H during its business operations and the restructuring of G&H’s loans with Wells Fargo.
Reinstein examined business documents and interviewed the parties and professionals who
had provided accounting and legal services to G&H. Reinstein prepared a draft report, which he
provided to the parties and their counsel. They reviewed the draft and provided their written
comments to Reinstein. Reinstein provided written responses to the parties’ comments and
finalized his report.
Reinstein submitted an 81-page accounting analysis to the district court with over 750
pages of financial documents supporting his conclusions. Reinstein’s report arrived at a final
accounting allocation between the parties. The parties filed written objections with the district
court concerning the Special Master Report. The district court held a hearing on the objections and
issued both an oral ruling and a written decision overruling some of the parties’ objections and
allowing other objections to be further argued at the forthcoming court trial.
The district court subsequently held a seven-day court trial on the remaining claims, after
which the parties submitted proposed findings of fact and conclusions of law. The district court
issued its written seventy-nine-page findings of fact and conclusions of law that dismissed all
claims except for the request for judicial dissolution. The district court ordered the dissolution and
addressed the winding up and accounting of G&H and the sale of the real property associated with
the Preston Dairy. In winding up G&H, the district court largely adopted the accounting of the
Special Master with some adjustments. Gomez filed post-trial motions challenging the district
court’s decision, which the district court rejected. Gomez timely appealed.
II. ISSUES ON APPEAL
1. Whether the district court erred in dismissing Gomez’s breach of contract claim because
the LOI was unenforceable.
2. Whether the district court erred in dismissing Gomez’s breach of fiduciary duty claim.
3. Whether the district court erred in dismissing Gomez’s quasi-estoppel claim.
4. Whether the district court erred in dismissing Gomez’s unjust enrichment claim.
5. Whether the district court erred in its accounting and winding up of G&H.
6. Whether any party is entitled to attorney fees on appeal.
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III. ANALYSIS
A. The district court did not err in granting summary judgment on Gomez’s breach of
contract claim because the LOI is unenforceable.
The district court dismissed Gomez’s breach of contract claim on summary judgment after
concluding that the LOI was an unenforceable agreement to agree. The district court held that the
LOI contemplated further definitive actions by the parties or others and that many of the material
terms of the LOI were uncertain. The district court also concluded that the LOI was unenforceable
because it lacked adequate real property descriptions for the dairies.
Gomez then filed a motion for reconsideration, arguing that the LOI was both an
enforceable contract to transfer the real property associated with the Buhl and Preston dairies and
an enforceable dissolution agreement. Gomez argued that the district court should look to parol
evidence to provide the missing property descriptions, and that the part performance exception to
the statute of frauds applied, even though the district court did not cite the statute of frauds as a
basis for its decision granting summary judgment. The district court denied the motion for
reconsideration after concluding that parol evidence cannot supply the necessary terms for a
contract, the part performance exception to the statute of frauds was not available in this instance,
and the LOI was unenforceable because it contemplated more formal future agreements.
Gomez contends that the district court erred when it concluded that the LOI was an
unenforceable agreement to agree because it failed to consider the entire LOI when determining
the intent of the parties. Gomez argues that the LOI is not ambiguous, contains all the material
terms to dissolve G&H, and that it was to be expected that there would be additional documents
to dissolve G&H. The Hurtados respond that the LOI was not a binding contract or dissolution
agreement, but an agreement to agree entered during a period of frantic negotiation to avoid
bankruptcy. The Hurtados argue that the LOI is missing critical components of a dissolution
agreement and fails to satisfy any of the criteria under Idaho Code section 30-25-701(a), which
identifies the circumstances under which an LLC can be dissolved.
“When reviewing a summary judgment ruling or a ruling on a motion to reconsider a
summary judgment order, this Court applies the same standard utilized by the district court in
deciding the motion.” Christiansen v. Potlatch #1 Fin. Credit Union, 169 Idaho 533, 540,
498 P.3d
713, 720 (2021). “With respect to that standard, this Court exercises free review to determine if
summary judgment is proper.”
Id. “Summary judgment is appropriate if ‘the pleadings,
depositions, and admissions on file, together with the affidavits, if any, show that there is no
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genuine issue as to any material fact and that the moving party is entitled to judgment as a matter
of law.’” Id. (quoting Gagnon v. W. Bldg. Maint., Inc.,
155 Idaho 112, 114,
306 P.3d 197, 199
(2013)). “When considering a motion for summary judgment, this Court construes disputed facts
in favor of the nonmoving party and draws all reasonable inferences in the nonmoving party’s
favor.”
Id. “If the evidence reveals no disputed issues of material fact, what remains is a question
of law, over which this Court exercises free review.” Krinitt v. Idaho Dep’t of Fish & Game,
162
Idaho 425, 428,
398 P.3d 158, 161 (2017) (citation omitted).
“An enforceable contract ‘must be complete, definite and certain in all of its material terms,
or contain provisions which are capable in themselves of being reduced to certainty.’” Geringer
Cap. v. Taunton Props., LLC, 172 Idaho 95,
529 P.3d 760, 766 (2023) (quoting P.O. Ventures,
Inc. v. Loucks Fam. Irrevocable Tr.,
144 Idaho 233, 238,
159 P.3d 870, 875 (2007)). “If terms
necessary to a contract are left for future negotiation, the contract cannot be enforced.” Hawes v.
W. Pac. Timber, LLC,
167 Idaho 896, 908,
477 P.3d 950, 962 (2020) (quoting Dursteler v.
Dursteler,
108 Idaho 230, 234,
697 P.2d 1244, 1248 (Ct. App. 1985)). “We have long held that a
document ‘must speak for itself, and, if it is sufficiently definite in its terms to enlighten the court
of the intent of the parties, it will be enforced.’” Frizzell v. DeYoung,
167 Idaho 801, 808,
477 P.3d
236, 243 (2020) (quoting Allen v. Kitchen,
16 Idaho 133, 142–43,
100 P. 1052, 1055 (1909)). “No
enforceable contract comes into being when parties leave a material term for future negotiations,
creating a mere agreement to agree.” Treasure Valley Home Sols., LLC v. Chason,
171 Idaho 655,
659,
524 P.3d 1272, 1276 (2023) (quoting BrunoBuilt, Inc. v. Strata, Inc.,
166 Idaho 208, 217,
457
P.3d 860, 869 (2020)).
Gomez argues that the following language in the LOI renders it an enforceable contract to
transfer the real property and business assets of the Buhl and Preston dairies to him:
Effective July 1, 2013, John Gomez, through an existing or a newly formed
entity, (Gomez) will be distributed the real property, CAFO Permit, irrigation
equipment, water rights, dairy facilities, herd, feed, equipment and other assets
located at the Buhl Dairy (G&H #2) and the Preston Dairy (G&H #3) subject
to the following indebtedness . . . .
After reviewing the entirety of the LOI, we agree with the district court that the LOI was
unenforceable because it contemplated further actions by the parties and Wells Fargo. The LOI
was an offer sent to Wells Fargo in an effort to restructure G&H’s debt, and there is no evidence
in the record that Wells Fargo accepted this offer. The plain language of the LOI illustrates that its
terms were conditioned on future events that had not yet occurred:
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• The title of the document is “Letter of Intent” instead of contract or dissolution agreement.
• The opening paragraph of the LOI stated:
[The parties] have agreed to the preparation and execution of definitive
transaction documents . . . . The ultimate goal will be to pay the entire
indebtedness now owed . . . to Wells Fargo Bank (WFB). This letter of
intent has been prepared in response to the letter of WFB, dated May 16,
2013 . . . .”
• Paragraph A indicated that G&H would “distribute[]” the Buhl and Preston dairies to
Gomez “through an existing or newly formed entity” after the existing mortgages of the
dairies were separated following discussions with two different lenders to take place at a
later date.
• Paragraph B stated that Jesus would sell the assets and lease the real property of the
Wendell Dairy to an unknown “third party” and that “[t]he sale and distribution of proceeds
[from selling the assets] will also take place [a month and a half later].”
• Paragraph C included language that Jesus would amend, at some unspecified point in the
future, a lease with third-party business partners and that approval by a third-party lender
was needed before certain transactions could take place.
• Paragraph E provided that the release of Gilbert from all liability to Wells Fargo “is a
condition to the transactions set forth herein.”
• Paragraph F contains a request by Gomez and Jesus for specific terms of new credit
agreements from Wells Fargo.
• Paragraph G provides that, after a new credit agreement is entered into between Gomez
and Wells Fargo, Gomez will pay $1.5 million and pledge $540,000 in collateral to Wells
Fargo.
• Paragraph H requests that Wells Fargo “forbear from taking any additional payments from
any of the dairies between now and July 1, 2013 . . . .”
The plain language of the LOI unambiguously conditions the transfer of the real and
personal property associated with the Buhl and Preston dairies on Wells Fargo’s acceptance of, or
agreement to, other terms contained in the document. For example, the Hurtado brothers and
Gomez conditioned their offer on Wells Fargo’s agreement to release Gilbert from future liability.
They requested that Wells Fargo grant them certain credit terms and forbear from taking additional
payments. They also conditioned their offer on the negotiation of deals with third parties who had
9
not signed the LOI. And the LOI expressly contemplated the future preparation and execution of
definitive transaction documents. Read in its entirety, the LOI was an offer to Wells Fargo in
connection with the ongoing negotiations that sought to keep G&H out of bankruptcy. Wells Fargo
never accepted the offer.
There is no indication in the LOI that the Hurtado brothers and Gomez agreed to transfer
the properties regardless of these conditions. The evidence indicated that the purpose of the
negotiations was to convince Wells Fargo to restructure G&H’s debt to avoid bankruptcy. In the
absence of this agreement, the parties would have no reason to transfer the properties. This purpose
is evident from the statement in the opening paragraph of the LOI, which states that it responds to
Wells Fargo’s May 16, 2013, letter. That letter rejected a prior offer by the Hurtado brothers and
Gomez, which proposed a different distribution of property.
We are similarly unpersuaded by Gomez’s argument that the LOI is an enforceable
dissolution agreement. First and foremost, for the reasons previously discussed, the agreement
lacks material terms and is an unaccepted offer. Further, while the LOI discusses transfers of the
assets of G&H, it does not expressly discuss the dissolution of G&H. Idaho Code section 30-25-
701(a), as pertinent here, allows for the dissolution of an LLC (1) under an event or circumstance
that the operating agreement states causes dissolution, or (2) after the affirmative vote or consent
of all the members to dissolve the LLC. I.C. § 30-25-701(a)(1), (2). G&H’s operating agreement
is silent as to dissolution, other than stating that the LLC is to be dissolved by the year 2044.
Gomez contends that the signatures of the Hurtado brothers and Gomez on the LOI constitute
consent to dissolve G&H because the LOI allegedly disposes of all of G&H’s assets. However,
the LOI makes no reference to dissolution and therefore the signatures cannot evidence consent to
a term not set forth in the document. Accordingly, we reject Gomez’s argument that the LOI is an
enforceable dissolution agreement.
For these reasons, we conclude that the district court correctly determined that the LOI is
unenforceable because it is conditioned on agreements and acceptances that had not yet occurred
and because it contemplated the preparation and execution of future transactional documents. The
district court properly granted summary judgment on Gomez’s breach of contract claim. Because
we hold that the LOI is unenforceable, we do not address the district court’s alternative basis for
summary judgment concerning the adequacy of the legal descriptions for the real property.
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B. The district court did not err in dismissing Gomez’s breach of fiduciary duty claim.
Gomez raised a breach of fiduciary duty claim that evolved throughout the litigation.
Gomez first raised this claim in his third amended complaint, but he did not specify how the
Hurtado brothers breached their fiduciary duties. Later, in opposition to the Hurtados’ second
motion for summary judgment, and then again in his proposed findings of fact and conclusions of
law after trial, Gomez argued that the Hurtados breached their fiduciary duties when they failed to
transfer the real property associated with the Buhl and Preston dairies to Gomez. Gomez did not
specify which fiduciary duties were breached until after the court trial had concluded.
Following the court trial, in his reply to the Hurtados’ proposed findings of fact and
conclusions of law, Gomez specified for the first time that he was alleging a breach of the duty of
loyalty. Gomez reiterated his breach of the duty of loyalty claim again in his motion to amend the
district court’s findings of fact and conclusions of law. Gomez also alleged for the first time, in his
reply memorandum in support of his motion to amend findings of fact, that Jesus breached his
fiduciary duty when he permitted JHD to use the 330 acres of Wendell Dairy farmland without
paying rent to G&H. The district court rejected these arguments.
Gomez repeats these arguments on appeal. In response, the Hurtados make two
preservation arguments. The Hurtados first argue that Gomez failed to preserve any argument
regarding a breach of the duty of loyalty. We disagree. The district court addressed and rejected
this argument in its decision on Gomez’s post-trial motions. “[A] party preserves an issue for
appeal if the trial court issues an adverse ruling.” State v. Miramontes, 170 Idaho 920, 924–25,
517 P.3d 849, 853–54 (2022). The district court’s decision on the issue preserved the argument for
appeal. Second, the Hurtados argue that Gomez failed to preserve any argument related to Jesus’s
failure to pay rent for JHD’s use of the 330 acres. Again, the district court considered and rejected
this argument in its decision on Gomez’s post-trial motions, which preserved the issue for appeal.
Turning to the merits, the district court rejected Gomez’s breach of fiduciary duty
arguments after concluding that a failure to comply with an unenforceable LOI was not a breach
of a fiduciary duty. The district court found no evidence that the Hurtados had breached a duty to
negotiate in good faith concerning the transfer of the real property associated with the Buhl and
Preston dairies. Rather, it concluded that the parties had simply failed to reach an agreement on
the material terms for the transfer of the real properties. The district court found no violation of
the duty of loyalty for Jesus’s use of the Wendell Dairy farm ground because Jesus paid rent for
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the dairy facilities at the Wendell Dairy, his allocation in the final accounting was adjusted for the
nonpayment of rent for the 330 acres of farmland at the Wendell Dairy, and he separately
purchased the Wendell Dairy in 2021.
Our review of the district court’s decision following a court trial “is limited to determining
whether the evidence supports the findings of fact and whether the findings of fact support the
conclusions of law.” Hood v. Poorman, 171 Idaho 176, 186,
519 P.3d 769, 779 (2022) (quoting
Burns Concrete, Inc. v. Teton County,
168 Idaho 442, 456,
483 P.3d 985, 999 (2020)). “Factual
findings will not be set aside unless they are clearly erroneous. A factual finding is clearly
erroneous if it is not supported by substantial and competent evidence.”
Id. (citations omitted).
“Although there may be conflicting evidence, substantial and competent evidence exists ‘if there
is evidence in the record that a reasonable trier of fact could accept and rely upon in making the
factual finding challenged on appeal.’” Id. at 187,
519 P.3d at 780 (alterations omitted) (quoting
Caldwell Land & Cattle LLC v. Johnson Thermal Sys., Inc.,
165 Idaho 787, 795,
452 P.3d 809,
817 (2019)). “This Court ‘is not bound by the legal conclusions of the trial court’ and exercises
free review to ‘draw its own conclusions from the facts presented.’”
Id. (quoting Morgan v. New
Sweden Irrigation Dist.,
160 Idaho 47, 51,
368 P.3d 990, 994 (2016)). “However, this Court
liberally construes a trial court’s factual findings in favor of the judgment entered.”
Id.
We review the district court’s decision on motions to amend findings or to amend a
judgment under an abuse of discretion standard and “a judgment will not be disturbed on appeal
where substantial and competent evidence is present to support the court’s findings.” Belstler v.
Sheler, 151 Idaho 819, 823,
264 P.3d 926, 930 (2011).
We find no error in the district court’s decision to dismiss Gomez’s fiduciary duty claims.
Idaho Code section 30-25-409 addresses fiduciary duties between members of a member-managed
LLC. Section 30-25-409(b) outlines three duties that fall under the duty of loyalty:
The fiduciary duty of loyalty of a member in a member-managed limited liability
company includes the duties:
(1) To account to the company and to hold as trustee for it any property, profit,
or benefit derived by the member:
(A) In the conduct or winding up of the company’s activities and
affairs;
(B) From a use by the member of the company’s property; or
(C) From the appropriation of a company opportunity;
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(2) To refrain from dealing with the company in the conduct or winding up of
the company’s activities and affairs as or on behalf of a person having an
interest adverse to the company; and
(3) To refrain from competing with the company in the conduct of the
company’s activities and affairs before the dissolution of the company.
I.C. § 30-25-409(b). Gomez fails to identify which duty of loyalty the Hurtado brothers violated.
Instead, Gomez simply generally asserts that a fiduciary duty was violated because the Hurtado
brothers refused to transfer the Buhl and Preston dairies’ real property to him. As discussed above,
the LOI was unenforceable. The Hurtado brothers did not breach any duty of loyalty when they
declined to transfer G&H’s real property pursuant to an unenforceable agreement. The district
court did not err in dismissing Gomez’s fiduciary duty claim.
Next, Gomez argues the duty of loyalty was breached because Jesus, through his entity
JHD, farmed 330 acres of the farm ground at the Wendell Dairy rent-free and continued to possess
the farm ground through 2022. However, as the district court properly concluded, Jesus’s
allocation was adjusted for the nonpayment of rent for the 330 acres of farm ground and Jesus
eventually purchased the Wendell Dairy in 2021. Once again, Gomez fails to identify which duty
of loyalty Jesus violated. Any benefit that Jesus received from the farm ground is remedied by the
adjustment of his allocation in the final accounting and subsequent purchase of the Wendell Dairy
property. We find no error by the district court.
Gomez also argues that the Hurtado brothers “did not act in good faith” because the
brothers required the dairies to be sold at fair market value and required that “the claim of
wrongdoing of Gomez had to be resolved” before transferring the dairies to Gomez. Gomez does
not specify the alleged “wrongdoing” at issue, but he may be referencing the 2011 disagreement
between Gomez and the Hurtado brothers over Gomez’s handling of G&H’s finances.
We similarly reject this argument. For the reasons previously discussed, the LOI was not
an enforceable contract. Without an enforceable contract, the Hurtado brothers had no obligation
to transfer the Buhl and Preston dairies to Gomez. The district court found no evidence that the
Hurtado brothers had breached a duty to negotiate in good faith and determined that the parties
had simply failed to reach an agreement. Gomez fails to explain how that finding was incorrect.
C. The district court did not err in denying Gomez’s quasi-estoppel claim.
Gomez also argues that the district court erred in dismissing his quasi-estoppel claim.
Quasi-estoppel is an equitable remedy. See Hollingsworth v. Thompson, 168 Idaho 13, 21–22, 478
13
P.3d 312, 320–321 (2020); Keybank Nat’l Ass’n v. PAL I, LLC,
155 Idaho 287, 293,
311 P.3d 299,
305 (2013); 31 C.J.S. Estoppel and Waiver § 146 (May 2024 update). “This Court reviews rulings
on equitable remedies for an abuse of discretion.” Pickering v. Sanchez,
173 Idaho 404, 415–16,
544 P.3d 135, 146–47 (2024) (quoting Asher v. McMillan,
169 Idaho 701, 705,
503 P.3d 172, 176
(2021)). Under this standard, we apply a four-part test to determine whether the trial court “(1)
correctly perceived the issue as one of discretion; (2) acted within the outer boundaries of its
discretion; (3) acted consistently with the legal standards applicable to the specific choices
available to it; and (4) reached its decision by the exercise of reason.” Lunneborg v. My Fun Life,
163 Idaho 856, 863,
421 P.3d 187, 194 (2018).
“The doctrine of quasi-estoppel prevents a party from asserting a right, to the detriment of
another party, which is inconsistent with a position previously taken.” Atwood v. Smith, 143 Idaho
110, 114,
138 P.3d 310, 314 (2006) (internal quotation marks and citation omitted). The elements
of quasi-estoppel are:
(1) the offending party took a different position than his or her original position and
(2) either (a) the offending party gained an advantage or caused a disadvantage to
the other party; (b) the other party was induced to change positions; or (c) it would
be unconscionable to permit the offending party to maintain an inconsistent position
from one he or she has already derived a benefit or acquiesced in.
Id. “Still, in order to state a claim for . . . quasi-estoppel, a plaintiff must at least allege, among
other things, a promise or representation by the party to be estopped.” Hollingsworth, 168 Idaho
at 22, 478 P.3d at 321.
Gomez argues that the Hurtado brothers changed their position after signing the LOI
because they demanded that Gomez pay fair market value for the real property associated with the
Buhl and Preston dairies. Gomez also alleges that they changed their position by demanding that
“Gomez had to make certain things right from the past . . . .” Gomez argues that he relied on the
LOI when he agreed to sell personal assets, take on debt, and assume a significant amount of
G&H’s debt during the restructuring. Despite this, the real property associated with the dairies was
not transferred to Gomez and he argues that this result is unconscionable. The Hurtados respond
that they never changed their position that the dairy properties needed to be sold. However, the
parties could not agree on a sales price and therefore the transfers did not occur.
Following the court trial, the district court determined that the first element of quasi-estoppel was not met because the LOI was unenforceable and thus no party took a legal position
that later changed. The district court did not err in dismissing the claim. “Quasi-estoppel prevents
14
a party from changing its legal position and, as a result, gaining an unconscionable advantage or
imposing an unconscionable disadvantage over another.” Hollingsworth, 168 Idaho at 22–23, 478
P.3d at 321–22 (emphasis added). Here, the Hurtado brothers never took a “legal position” because
the LOI was not an enforceable agreement, but instead was an offer, among several other offers,
to Wells Fargo that was never accepted. In the absence of an enforceable LOI, the Hurtado brothers
took no legal position that later changed.
The district court also concluded that Gomez had not met the second element of quasi-estoppel based on its factual findings that: (1) the Hurtado brothers were not offending parties but
instead were business partners attempting to negotiate a way out of a financial crisis; (2) Gomez
was not induced to change positions but instead was an experienced businessperson who made a
financial decision that he now regrets; and (3) the Hurtado brothers did not take an inconsistent
position and it was not unconscionable to allow G&H to lease the real property to Gomez instead
of conveying it because Gomez was an experienced businessman and agreed to the arrangement
when he signed the leases.
Gomez has not challenged these findings of fact. Instead, he argues on appeal that his
situation is unconscionable because he sold assets and took on additional debt in anticipation of
receiving the Buhl and Preston dairies’ real property, which the Hurtado brothers then refused to
transfer to him. We disagree. The LOI was unenforceable because Wells Fargo never accepted the
offer contained therein. The evidence demonstrated that the Hurtado brothers and Gomez
continued to negotiate with Wells Fargo. A number of draft term sheets were exchanged between
the members of G&H and Wells Fargo. Eventually, the Hurtado brothers and Gomez agreed to
term sheets with Wells Fargo but could not agree on a real property distribution agreement. Instead,
the term sheets for Melon Valley and Daytona indicated that the entities would lease the real
properties associated with the Buhl and Preston dairies from G&H. Thus, the evidence indicates
that Gomez was aware that he would be leasing the real property from G&H when he closed on
the restructuring.
As for Gomez’s argument that it was unconscionable that he took on more debt than the
other members of G&H during the restructuring with Wells Fargo, the district court concluded
that, while Gomez took on greater debt and made a larger cash injection, he failed to account for
the value of personal property assets he received. Again, Gomez has not challenged the district
court’s findings on this point. As discussed further below, we conclude that the district court did
15
not err in approving the final accounting and its allocations of each member’s capital contributions.
Given those factual findings by the district court, the district court did not err in concluding that
Gomez did not meet the second element of quasi-estoppel. We affirm the district court’s decision
dismissing Gomez’s quasi-estoppel claim.
D. We do not consider Gomez’s argument concerning his unjust enrichment claim because
he failed to support it with citations to legal authority.
Gomez also argues that the district court erred by dismissing his unjust enrichment claim.
However, Gomez’s opening brief fails to include a single citation to relevant legal authority in this
section of his opening brief. “We will not entertain an issue that is ‘not supported by any cogent
argument or authority.’” Hart v. Shepherd (In Re Contest of Election), 164 Idaho 102, 108,
425
P.3d 1245, 1251 (2018) (alteration omitted) (quoting Bach v. Bagley,
148 Idaho 784, 790,
229 P.3d
1146, 1152 (2010)). Idaho Appellate Rule 35 requires that the arguments of the parties shall
contain “citations to the authorities, statutes and parts of the transcript and record relied upon.”
I.A.R. 35(a)(6). “[W]here an appellant fails to assert his assignments of error with particularity
and to support his position with sufficient authority, those assignments of error are too indefinite
to be heard by the Court. . . . [T]o the extent that an assignment of error is not argued and supported
in compliance with the [Idaho Appellate Rules], it is deemed to be waived.” Primera Beef, LLC v.
Ward,
166 Idaho 180, 184,
457 P.3d 161, 165 (2020) (quoting Clark v. Cry Baby Foods, LLC,
155
Idaho 182, 185,
307 P.3d 1208, 1212 (2013)). Gomez failed to properly support this argument and
we therefore do not consider it. 1
E. The district court did not err in its final accounting and winding up of G&H.
Following the court trial, the district court issued its written findings of fact and conclusions
of law and ordered the judicial dissolution of G&H. Prior to ordering dissolution, the district court
conducted a four-part analysis. First, the district court determined that dissolution was necessary
because all parties sought the dissolution of G&H. Next, the district court wound up the activities
and affairs of G&H. The district court largely adopted the Special Master Report’s allocation of
assets and liabilities but adjusted the allocation to account for some of the parties’ objections and
to account for transactions that were not included in the Special Master Report. The district court
1
We also note that throughout his briefing on appeal, Gomez calculates damages and prejudgment interest on his
respective claims. Because we find no error in the district court’s decisions dismissing his claims, we do not address
this aspect of Gomez’s briefing.
16
then characterized each transaction by the members of G&H as debt or capital contributions. This
characterization was crucial to determining the final allocation to each member because G&H did
not have a sufficient surplus to fully refund each member’s equity contributions. See I.C. § 30-25-
707. Lastly, the district court arrived at a final accounting allocation between the members and set
forth a framework to marshal and distribute G&H’s remaining assets. This required the sale of the
Preston Dairy, notification and payment to creditors of the dissolution, and the final dissolution of
G&H.
Gomez argues that the district court erred in the accounting and winding up of G&H.
Specifically, Gomez argues that: (1) Gilbert was not entitled to one-third interest in G&H; (2)
dissolution of G&H had already occurred in 2013; and (3) the district court erred in its final
accounting and winding up of G&H. These arguments attack factual findings by the district court.
“Factual findings will not be set aside unless they are clearly erroneous. A factual finding is clearly
erroneous if it is not supported by substantial and competent evidence.” Hood v. Poorman, 171
Idaho 176, 186,
519 P.3d 769, 779 (2022) (citations omitted).
1. We will not address Gomez’s argument that Gilbert is not entitled to a one-third interest
in G&H because he failed to support his argument with citations to legal authority.
Gomez argues that Gilbert is not entitled to any interest in G&H because he dissociated
from G&H under the terms of the LOI. Gomez contends that the district court’s inclusion of Gilbert
in the winding up decision unjustly enriched Gilbert. Gomez’s opening brief fails to cite any legal
authority supporting his position. Gomez also fails to cite to or grapple with Idaho Code section
30-25-602, which governs dissociation of members in an LLC. As a result, we do not address this
claim. Primera Beef, 166 Idaho at 184–85, 457 P.3d at 165–66.
2. The LOI is unenforceable and therefore cannot establish the date of dissolution.
Gomez argues that the district court’s accounting was erroneous because it was based on a
dissolution date of 2022, when the district court issued its decision. Gomez argues that the LOI
was an enforceable dissolution agreement and therefore contends that the date of dissolution
should be 2013, when the parties signed the LOI. It appears Gomez’s argument is based entirely
on his contention that the LOI is an enforceable dissolution agreement. However, for the reasons
discussed above, we hold that the LOI is unenforceable. Accordingly, we reject Gomez’s argument
that the district court erred because it failed to establish the date of dissolution as sometime in
2013.
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3. The district court did not err in its final accounting.
Gomez’s arguments challenging the district court’s final accounting, based largely on the
report of a special master, are difficult to follow. First, he appears to argue that the district court
erred in its characterization of certain advances by the members of G&H. Specific transactions
that Gomez takes issue with are (1) the $1.5 million cash injection he made when G&H’s debt was
restructured with Wells Fargo, (2) Melon Valley’s and Daytona’s assumption of the Wells Fargo
debt, and (3) liabilities that G&H owed to Gomez’s other businesses that provided services to
G&H. Gomez also argues that the district court erred in its member allocations related to
improvements that Gomez made to the Wendell Dairy before the formation of G&H, rent owed by
Jesus for use of the Wendell farm property, and rent owed by Gomez for the Preston Dairy.
In characterizing advances by the members of G&H as either debt or equity contributions,
the district court adopted, with some modifications, the Special Master Report. “The special
master’s findings which the court adopts are considered to be the findings of the court. The special
master’s conclusions of law are not binding upon the district court, although they are expected to
be persuasive.” Dorsey v. Dorsey, 172 Idaho 667,
535 P.3d 1040, 1050 (2023) (citation omitted).
“To the degree that the district court adopts the special master’s conclusions of law, they are also
the conclusions of the court.”
Id. (citation omitted). “The district court [is] required to accept the
master’s findings of fact unless they [are] clearly erroneous. . . . A trial court’s findings of fact will
not be set aside on appeal unless they are clearly erroneous.”
Id. (alterations in original) (quoting
City of Pocatello v. State,
152 Idaho 830, 840,
275 P.3d 845, 855 (2012)).
Gomez submitted comments and concerns to Reinstein, the court-appointed Special
Master, before he finalized his report. Reinstein provided written responses to Gomez’s concerns
and explained the reasons for his accounting recommendations. After Reinstein filed his report
with the district court, Gomez lodged objections to the report with the district court. His objections
essentially repeated the same comments and concerns previously conveyed to Reinstein. The
district court held a hearing on the objections and issued both an oral ruling and a written decision
rejecting most of Gomez’s objections, but allowed some to be further argued at trial.
Following the court trial, the district court’s decision addressed and dismissed Gomez’s
remaining objections. The district court provided a detailed, well-reasoned seventy-nine-page
findings of fact and conclusions of law in which the district court reviewed and adopted, with some
18
modifications, the detailed Special Master Report. The amounts that Gomez complains about are
accounted for in the Special Master Report.
Gomez’s arguments on appeal amount to little more than asking us to second-guess the
Special Master and the district court without explaining how the district court erred. Gomez
provides few record citations, no legal citations, and his arguments are difficult to follow. The
district court thoughtfully considered and analyzed each of the contested items before concluding
whether each amount was a debt or capital contribution. We find no error in the district court’s
findings and conclusions and affirm its final accounting and judgment dissolving G&H.
F. The Hurtados are awarded attorney fees on appeal under Idaho Code section 12-121.
Gomez requests attorney fees pursuant to Idaho Code section 12-121 for the first time in
his reply brief. We deny Gomez’s request both because he failed to request attorney fees in his
opening brief and because he is not the prevailing party on appeal. See I.C. § 12-121; I.A.R. 41(a).
The Hurtados also request attorney fees on appeal pursuant to Idaho Code section 12-121.
Attorney fees may be awarded to the prevailing party under section 12-121 when a “case was
brought, pursued or defended frivolously, unreasonably or without foundation.” I.C. § 12-121.
“When an appellant fails to present a cogent argument as to why he should prevail, an award to
his opponent is appropriate.” Millard v. Talburt, ___ Idaho ___, ___, 544 P.3d 748, 765 (2024)
(quoting Turner v. Turner,
155 Idaho 819, 827,
317 P.3d 716, 724 (2013)). “Idaho Code section
12-121 allows attorney fees in a civil action if the appeal merely invites the Court to second-guess
the findings of the lower court.”
Id. (quoting Erickson v. Erickson,
171 Idaho 352, 371,
521 P.3d
1089, 1108 (2022)).
Because we affirm the district court’s decision, the Hurtados are the prevailing parties on
appeal. The Hurtados contend that they are entitled to an award of attorney fees because Gomez’s
appeal lacks cogent legal arguments as to how the district court erred, fails to provide legal or
factual citations supporting his arguments, and simply asks this Court to second guess the trial
court. We agree and award the Hurtados their reasonable attorney fees on appeal pursuant to
section 12-121.
Gomez failed to grapple with the plain language of the LOI that the district court relied on
in determining that the LOI was unenforceable. Gomez’s challenges to the dismissal of his claims
for unjust enrichment, quasi-estoppel, breach of fiduciary duty, and the dissolution and winding
up of G&H were difficult to follow and Gomez failed to cite legal authority in support. In many
19
instances, Gomez failed to articulate how the district court erred or merely asked this Court to
reweigh the evidence and second-guess the detailed and well-reasoned findings of fact and
conclusions of law of the district court. Therefore, we conclude that his appeal was brought and
pursued unreasonably and without a legal foundation.
IV. CONCLUSION
For the foregoing reasons, the decision of the district court is affirmed. We award the
Hurtados their reasonable attorney fees pursuant to Idaho Code section 12-121. The Hurtados are
also awarded their costs on appeal pursuant to Idaho Appellate Rule 40.
Chief Justice BEVAN, Justices MOELLER and MEYER, and Pro Tem Justice BASKIN
CONCUR.
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